Changes to the Australian superannuation law on 1 July 2017 reduced the options available to individuals in respect of moving their UK Pension to Australia.
The UK pension laws also changed with effect from 9 March 2017, which means that the choices available to individuals are as follows:
- Leave their UK pension in the a UK pension scheme;
- Export their UK pension to a Recognised Overseas Pension Scheme (ROPS) in the country where they are a tax resident; or
- Transfer their UK pension to another country (other than the UK or Australia) and potentially suffer an upfront tax charge of 25% of the UK pension fund on transfer.
If you have a UK pension we can advise you on the best course of action, from a UK and Australian financial and tax perspective.
Key issues to consider are:
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How should you access your UK Pension fund? As an annuity? By receipt of a lump sum? By rolling over to a recognised overseas pension scheme that has been approved by HMRC (the UK tax authority)?
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What are the UK tax implications for your UK pension?
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Are you 55 years old or more and eligible to rollover your UK Pension to a Australian self-managed superannuation fund (SMSF) which is a recognised overseas pension scheme under UK tax law?
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Is there Australian tax on the rollover of your UK Pension to an SMSF?
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Will your rollover from your UK Pension to an SMSF exceed the non-concessional superannuation cap? From 1 July 2017, the non-concessional superannuation cap is $300,000 (assuming that you are eligible for the three year bring forward rule). In addition, you cannot make a non-concessional superannuation contribution unless you have total superannuation member account balances of less than $1.6 million.
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Should you transfer your UK Pension to a recognised overseas pension scheme in another country?
We can provide you with expert advice to help you make the most appropriate decision regarding your UK pension, from a personal, financial and tax perspective, potentially resulting in significant tax savings or more income. There is no need to deal with advisers offshore – you can obtain all of the advice you need here in Australia from qualified reputable professionals.
